HELPING UNEMPLOYED WORKERS KEEP THEIR HOMES
A New Tool to Project Availability of Unemployment Benefits
Public/Private Partnerships Making a Difference
To help unemployed workers keep their homes, the Department of Labor is currently partnering
with the Federal Reserve Bank, the Department of Treasury, Fannie Mae, Freddie Mac, and the
HOPE NOW Alliance, a private sector, broad-based group whose mission is to maximize
homeownership while minimizing foreclosures and to keep Americans in their homes. Recent
work has focused on how to specifically help individuals who have become unemployed as a
result of the economic downturn, many of whom are now receiving unemployment benefits.
American Recovery and Reinvestment Act: New Options
As a result of new programs created by the American Recovery and Reinvestment Act, such as
the Making Home Affordable’s Home Affordable Modification Program (HAMP), new loan
modification options are available for borrowers. These programs have specific guidelines on
how to treat a borrower’s income, including unemployment income, for purposes of modifying
an individual’s mortgage loan. Under HAMP, for example, the servicer is to determine that the
unemployment income will continue for at least nine (9) months. For more information regarding
HAMP, visit: https://www.hmpadmin.com/portal/index.html.
Treating Unemployment Benefits as an Income Source
Previously, it was a challenge for individuals receiving unemployment benefits to demonstrate
projected income for a nine (9) month period. In normal economic times, most UI beneficiaries
only receive up to twenty-six (26) weeks of benefits under the regular Unemployment Insurance
(UI) program, or about six-and-a-half months of income. As a result of the economic downturn,
Congress passed new provisions for extending and expanding UI benefits. Depending on the
level of unemployment in a state, the potential length of benefits an individual can receive is now
seventy-nine (79) weeks, or about 20 months. Differing state UI laws and unemployment levels,
as well as the individual claimant’s circumstances, may mean the potential length of benefits for
a specific individual is lower than 79 weeks.
Below is a breakdown of the current unemployment insurance programs that make up the 79
The regular UI program’s maximum weeks of entitlement is generally 26 weeks.
The Extended Unemployment Compensation (EUC) program has a maximum of either up
to 20 or up to 33 weeks depending upon the unemployment rate in the state. Congress is
currently considering further extensions of benefits under this program for high
The Extended Benefit program has a maximum of up to 13 or 20 weeks depending upon
the unemployment rate in the state and the state law governing the EB program.
A New Tool for Mortgage Companies and Servicers
To support mortgage companies participating in HAMP better understand the unemployment
benefits an individual may receive under the three different programs, the Department of Labor
has developed an on-line tool to support projecting potential eligibility for unemployment
benefits over time. Using the information from the unemployment claimant’s monetary
determination letter received from the state in which the individual filed for benefits, the new
tool, named the Unemployment Benefit Estimation Tool, can be used by mortgage companies,
servicers, investors, as well as other stakeholders, in estimating an individual’s potential UI
benefits and the potential duration for receiving benefits. It is important to note that eligibility
for unemployment benefits must be determined on a week to week basis. Therefore, the tool
projects potential benefits for an individual.
Individuals applying for unemployment benefits receive a monetary determination letter from the
state in which they reside which identifies the amount of unemployment benefits they are eligible
to receive and the effective date of the claim. The new on-line tool uses the information
provided in the monetary determination letter and the state of residence to calculate individual
specific information on projected unemployment insurance benefits that will include:
Potential total weeks of UI eligibility for all currently funded unemployment insurance
programs, except Trade Readjustment Allowance benefits (see below);
The effective date and the potential ending date of the claim;
The individual’s weekly benefit amount; and,
The total potential benefit dollars to be paid for an individual over the full life of their
claim (includes regular UI, Emergency Unemployment Compensation (EUC), and any
Extended Benefits (EB) available in the state).
The Unemployment Benefit Estimation Tool is easy to use and can be found at
www.doleta.gov/unemploy in the “Quick Links” section under “Other Resources.”
Other Services and Benefits for UI Claimants
One-Stop Career Centers
In addition to receiving unemployment benefits, UI claimants are referred to One-Stop Career
Centers (these have different names in different locations around the country) for employment
and training services to help them become reemployed. Services include career information and
guidance, skills assessments, job search assistance, technology literacy, referrals to jobs, and
training to gain both basic and occupational skills to help individuals return successfully to the
labor market. For more information on services available through One-Stop Career Centers and
to find One-Stop locations, ETA’s Worker Reemployment Portal provides easy to access
information at: http://www.careeronestop.org/ReEmployment/.
Trade Adjustment Assistance/Trade Readjustment Allowance Benefits
Some unemployed workers may be eligible for benefits and services under the Trade Adjustment
Assistance (TAA) program because they are unemployed as a result of foreign trade. Under the
TAA program, individuals may be entitled to additional income support called a Trade
Readjustment Allowance (TRA), similar to unemployment insurance, if they are participating in
an approved training program. The TRA weekly benefit amount is the generally the same
amount as the UI amount.
Trade Readjustment Allowances (TRA) are available to provide income support to individuals
while they are participating in full time training. TRA benefits are defined in two (2) categories:
Basic TRA and Additional TRA. Each category has its own set of eligibility requirements.
Basic TRA is payable if the worker is enrolled or participating in TAA training, has
completed such training, or has obtained a waiver of such training requirement.
Additional TRA is payable only if the worker is participating in TAA approved training.
In general, certified workers may be eligible for 104 weeks of income support (up to 130 weeks
if remedial education is required), usually broken out as follows:
Up to 26 weeks of state unemployment insurance (UI) compensation,
Followed by 26 weeks of basic TRA, and
Up to 52 weeks of additional TRA to assist the worker in completing a TAA training
Certified workers who must undergo remedial education as a part of their training plan
may be eligible for up to 26 weeks additional weeks of additional TRA for any weeks the
individual must undergo remedial education. The worker is eligible for one week of these
26 weeks for each week that the worker's participation in remedial education extends
their training program.
Lenders and others should ask individuals if they are eligible for these benefits. Individuals
eligible for TRA benefits will receive a separate monetary determination for TRA entitlement.
Individuals will not receive both UI and TRA at the same time. A TRA monetary determination
indicates the potential of additional benefits once all UI entitlement is exhausted or in lieu of UI
in some cases. States have different policies and may not take a TRA claim or issue a TRA
monetary determination until individuals have exhausted their UI entitlement. Similar to the
regular unemployment program, eligibility is determined on a weekly basis. Benefit receipt is
subject to individuals meeting the individual state’s eligibility criteria.